Team 2 Galloping Hill Golf Course

MIS Report on Galloping Hill Golf Course/KemperSports

MGS 3040*05 GROUP 2

Mike Williams

Tad Walsh

 Mike Petruzzella

 Nick Santangelo

Erik Supardi

INTRODUCTION

     The object of this report is to find out as much information we can about the management information systems implemented at Galloping Hill golf course by the KemperSports group.  We will also look at the business strategy that is being used.  As a group we will then use our knowledge gained in this course to analyze and come up with possible improvements to these systems.  

  
    Galloping Hill Golf Course sprawls across 271 acres in Kenilworth and Union. Characterized by its natural terrain of rolling hills and valleys, the course often referred to as "The Hill", has a reputation as one of the most challenging courses in the area.  The 18th hole course features 6680 yards of golf from the longest tees for a par of 71.  The course was designed by Willard G. Wilkinson and opened in 1928.  Most recent renovations were completed by Stephen Kay in 1998.

  
     Galloping Hill also offers an additional 9 hole practice course, a brand new driving range and has under construction a state of the art Learning Center.  The Learning Center will be the most advanced in the area, staffed with PGA professionals and containing state of the art video instructions.

  
     The recent overhaul of Galloping Hill can be attributed to KemperSports, which began managing the course and Learning Center in January 2010.  They are leaders in the field of golf course management and bring a wealth of knowledge that will constantly improve the complex.  The final phase of construction is 40,000 ft clubhouse.

KemperSports Business Strategy

INDUSTRY ANALYSIS

    
      In order to properly assess Galloping Hill and KemperSports business strategy it is important to understand the golf industry.  Our group chose to use Porter’s 5 forces model to illustrate where they stand in this industry.  Understanding the bargaining power of customers, rivalry, bargaining power of suppliers, threat of substitutions, and threat of new entrants will help us identity and advise them on potential problems with their business strategy.  

      The bargaining power of the customers is high in the golf course management industry.  There are a limited amount of golf enthusiasts in the area, and this number remains pretty constant regardless of what the courses do.  This means theses customers chooses which courses to play at based on a number of factors.  It is important for Galloping Hill to keep its prices in line with other courses, while maintaining the course to the highest level.  The recent upgrades made to the course are an example of the customer’s power in demanding top of the line amenities.  

      On the other hand, the bargaining power of suppliers is low in this industry.  KemperSports manages hundreds of courses across the country and has long-standing relationships with all of its suppliers.  They are such a big client that it is in the supplier’s best interest to keep them happy and offer reasonable prices.  

    The threat of new entrants is very low in this case.  It costs millions of dollars in start up money to build a golf course.  In addition, this area of New Jersey is very densely populated and a golf course requires many open acres of land.  There simply is nowhere to build a new course in the area.  It also requires a great deal of expertise to design a course.

     The threat of substitutions is a small issue that Galloping Hill faces.  There are other courses in the area that golfers could choose to play at.  However, most of them are country clubs that are extremely expensive.  The other courses are privately owned and operated.  This means there is no government funding which raises the price to play.  Galloping Hill and Ashbrook and the only 2 county courses in Union County and they are both operated by KemperSports.  They offer county residents substantial discounts as well as lower starting prices.  This gives Galloping Hill a huge competitive advantage over the competition.  For these reasons, the threat of substitutions is not high. 

      We believe that the rivalry force is high because the few courses in the area are all competing for the same clientele.  Although Galloping Hill is able to offer lower prices, many golfers put price secondary to the quality of the course.  This creates an atmosphere where all local courses are trying to upgrade and improve to gain a leg up.  The addition of a brand new driving range and state of the art learning center has given Galloping Hill a big competitive advantage for the time being, but they must continue to improve to stay on top.

   
    Taking Porter’s 5 Forces into consideration KemperSports had to come up with a competitive strategy for Galloping Hill.  It appears as though they use a hybrid strategy because they are competing in such a unique business. Overall, we categorized it as low cost focus because they offer the lowest prices within a particular area of New Jersey.  However, we also noticed that within the last few years they have tried to differentiate themselves by upgrading the course and facilities to be the nicest in the area.  For these reasons, we determined it to be both low cost/differentiation with a focus on a particular segment of the market. 

Force	Strength	Reason
Bargaining power of customers	High	Courses must keep customers happy to ensure return business
Bargaining power of suppliers	Low	KemperSports has long standing relationships with suppliers
Rivalry	High	The few Courses in the area are constantly competing
Threat of substitutions	Low	There are only 2 public courses in union county
Threat of new entrants	Low	Many entry barriers, extremely high startup cost and limited land availability

INFORMATION SYSTEMS

      Running a golf course requires the use of certain information systems.  Since KemperSports manages hundreds of courses, including Galloping Hill, they have worked hard to find the systems that can help them streamline their operation and make it very customer friendly.  Since they took over management 3 years ago they have used three different information systems, finally finding one this year they feel is ideal.  Problems that they faced in the past couple of years was a sever silo effect resulting in lead to a lot of channel conflict and duplicate information.  There were different systems in place for sales, tee time sheets, customer information, and email blast capabilities.  

      After analyzing their problems, they decided to implement a system that made it easy to track customers, sales, and other demographics.  They used Galloping Hill as one of the first courses to start using a new system that is called EZ Links.  It is a point of sales system that keeps track of all of these things.  They then use Microsoft Access to connect and integrate demographics, sales, how often you play, what else you purchase when you play, and automatically sends out email alerts for special deals and announcements.  EZ Links also allows golfers to easily make tee times online and the course is able to accommodate more customers every day.  Since all of these systems are now integrated into one CRM information system the silo, effect is no longer a problem at Galloping Hill.

      In order to expand their reach to more golfers Galloping Hill has teamed up with TaylorMade, which is one of the largest golf apparel companies in the world.  They are the sponsors of the state of the art learning center that was just built. TaylorMade has a huge customer base throughout the country that will be attracted to the motion capture technology that the learning center offers for buying new clubs and improving your game.  This will attract people from beyond the union county area to visit Galloping Hill because there are only three other such learning centers in the nation.

Recommendation/ Solutions

    Since taking over management of Galloping Hills KemperSports has worked to streamline their information systems.  They have been successful in implementing new systems and driving up attendance at the course.  However, after analyzing their business strategy and where they fit in the marketplace our group has identified several ways in which they could improve.  The main problems we focused on were marketing through social media, improving the point of sales system, and improving inventory management.

    In today's world of Internet 2.0 we believe it is vitally important to have a strong web presence.  Galloping Hills has a website and sends out emails to existing members, but we believe they could benefit from using other resources.  As we learned from Lindsey C. Homes, social media is a power and free tool that can be used to reach a much wider audience.  By simply creating a facebook page and Twitter account they can open themselves up to a new market.  Tweeting about promotions, discounts, and special events will raises awareness.  In our interview it was apparent that the golf clientele tends to be an older demographic.  Using social media as a way of advertising will be an effective way of tapping into the younger demographic.  
 

   
    Since taking over KemperSports has been searching for the ideal information systems to use.  Because of this they have switched systems 3 times over the past 3 years.  They are happy with the point of sales system (EZ Links) they are currently using and it seems to be pretty effective.  However, due to the multiple turnover of systems a lot of employees do not know how to use the new technology.  New employees are trained after they are hired, but the older workers have been given little to no training since the new system has been put in place.  This causes errors to be made and precious time to be wasted while they figure things out.  Our recommendation would be to create an employee training program. It is important that all employees are on the same page and know the ins and outs of the programs they are using.  This will cut down on the human error factor as well as making the customer service quicker and more effective.  

While building the new state of the art club house Galloping Hills has been in a state of transition.  They have been moved to a temporary clubhouse with limited space which has forced them to move some inventory to storage units.  Since this has been going on there has been hundreds of dollars worth of inventory that has gone missing.  Our recommendation on how to eliminate this is to implement a radio frequency identification system (RFID).  This is a simple way to keep track of every piece of inventory and make sure that none is lost or stolen.  This will also be helpful because they are moving into the new club house which will have a lot of extra space.  When this happens they will be selling a lot of new products.  With this extra inventory it is important to have an effective way of managing it.  For these reasons RFID will be an important asset moving forward.

Overall KemperSports has taken many steps in the right direction while managing Galloping Hills golf course.  They have vastly improved the facilities and are attracting many more customers.  It is important that they continue to use technology to keep things running smoothly.  Using social media will allow them to attract even more customers especially from the younger demographic.  Training their employees to use these new technologies will make sure their are no errors made.  Lastly, implementing RFID will allow them to manage the influx of inventory effectively.  We believe by making these changes KemperSports can improve the quality of Galloping Hills golf course.